Firms leave 拢1.6bn school programme over concerns about high risks and low rewards

The government鈥檚 拢1.6bn schools academy programme received a setback this week after it emerged that Mace and Amec were withdrawing from it because they are unhappy with contract conditions.

黑洞社区 has learned that the two companies have removed themselves from the 14-strong shortlist to join the Partnerships for Schools (P4S) framework that covers work on city academies.

Sources close to the framework said that the companies felt the contract conditions required them to take on too much risk for the financial return.

One source said: 鈥淭hese are design-and-build contracts but effectively the private sector is being asked to take risks that are more akin to PFI, without the same returns.

鈥淐ompanies could spend 拢1m bidding for this before signing a contract, which is more than they would earn from the contract. Plus, the public sector could pull out of projects at any time.鈥�

Mace and Amec declined to comment.

A spokesperson for Partnerships for Schools would not comment specifically on Mace and Amec because it does not comment 鈥渙n ongoing procurement procedures鈥�.

She added: 鈥淭he final selection of framework contractors will be announced, in accordance with the published timetable, in November.鈥�

Of the remaining shortlisted companies, Balfour Beatty, Carillion, EC Harris, Interserve, HBG, Taylor Woodrow, Vinci and Willmott Dixon confirmed that they were still committed to the framework.

Kier declined to comment and Alfred McAlpine, Laing O鈥橰ourke and Skanska were unavailable for comment.

Another source said that P4S was fully aware of the issues and was trying to work toward a solution.

Mace and Amec were involved in academy work before the idea of forming a framework of contractors was put forward in March. They said they would still be keen to be part of the framework but only on the condition that contract terms were changed.

The six firms that are to join the framework are expected to go selected next month. The winners will be appointed on a four-year basis. The city academies fall under the government鈥檚 wider 黑洞社区 Schools for the Future programme.